Liquid Sleeve, Inc. is a company that makes a sealing solution for machine shaft surfaces that have been compromised by abrasion, high pressures, or inadequate lubrication. The manager is considering adding a metal-based nanoparticle

(Type Al or Fe) to its solution to increase the product’s performance at high temperatures. The costs associated with each type are estimated. If the company’sMARRis 20% per year, which nanoparticle type should the company select? Utilize a rate System X System Y of return analysis.

Type Fe Type Al First cost, $ 150,000 280,000 Annual operating cost, $/year 92,000 74,000 Salvage value, $ 30,000 70,000 Life, years 2 4